Fintech products are gaining popularity and pose real competition to traditional banking. According to the 2019 FIS PACE study, 73% of consumer banking interactions are digital. Fintech startups have already raised a record $100M in Q2 2020 and, apparently, have cracked the secret to success — better CX and personalized customer service.

Direct-to-consumer banks have the highest consumer satisfaction outpacing credit unions. Digital banks also have the lowest rate of customer churn. 

While only half of the customers from the banking sector believe they received consumer-centric service, the same indicator reaches over 80% for fintech. 

Yet good can always be better. 

There are three mistakes most fintech companies make while setting customer support service. By avoiding them, businesses can stand out in both the traditional and digital banking sectors. 

1. Investing in tech rather than people

Tech solutions made banking accessible and drove consumers to fintech products in the first place.  However, when it comes to communicating with customers the rule of thumb is not to overdo with tech. Retaining “a human touch” is one of the biggest challenges fintech companies face, but they keep investing in tech-enhanced solutions rather than people. 

Recently, Robinhood’s customers were unable to reach a representative over the phone to report that their accounts had been hacked. They were left waiting for emails from support that would take days to arrive. Such a basic customer service channel as a phone line was not considered important for one of the biggest fintech companies in the US. This situation demonstrates that people still need to talk to a real person when it comes to handling financial issues. It doesn’t matter how small or big the business, or how tech-savvy the customers — talking to humans is still important.

Tip: If you plan to shut down your phone lines and switch completely to online customer support channels, think again. Fintech companies deal with a lot of sensitive information. The level of anxiety among customers is higher than usual. Our data indicate that during COVID-19 people started calling more regarding issues that could have been handled online — just to make sure their problems were definitely resolved.

In order to excel in customer support, don’t leave your customers in a state of uncertainty. Provide them with an option to talk to a person. Not a chatbot, not a virtual assistant, and not an email. A person.

2. Relying only on in-house support

Outsourcing is not new for fintech: as many as 20% of startups outsource their technology needs while another 65% are considering outsourcing in the near future. However, most of it is focused on programming and development, while outsourced customer support is still considered a compromise on quality and a higher security risk. 

No doubt, building an in-house customer support department gives businesses greater control over the process and direct access to customers’ insights. It’s especially important when your product is still in development.

But as operations grow, expanding an in-house customer support team may actually reduce its quality since it’s time-consuming and expensive. At some point, demand will exceed the in-house team’s capabilities and cause an increase in handling time. Outsourcing will enable fast team scalability and will save you from an operational headache. 

Tip: since fintech has especially high security standards, make sure an outsourced provider meets them. Nowadays there are multiple certifications that guarantee data protection by third parties. The most common is ISO 27001. However, to deal with payments, the provider should have a PCI Level 1 certification, developed by payment systems themselves.

3. Overestimating the level of product adoption

Millennials are the largest target demographic for fintech products since they’re more likely to adopt tech solutions. But companies should not assume that customers will figure out the way to use financial products easily and without confusion. 

Overall customer adoption of fintech products is 33% which mostly refers to payments and money transfer services. Financial planning, insurance and borrowing have lower adoption rates — 10-24%. 

Moreover, millennials aren’t the only group of people using fintech products. 64% of consumers use two or more fintech products, and some of them may need more guidance than others. Companies should not forget to invest in educating their users and explaining how to use the product. Ignoring this will lead to an increase in customer support expenses. 

Tip: One way to avoid unnecessary customer service inquiries is to invest in self-service tools: tutorials, explanatory videos, clear instructions, comprehensive FAQ section, and chatbots. Also, make sure your customer support reps are well-trained to deal with the technical complexity of the product and can explain it to customers in a simple way. 

Mastering customer service with a human face is something fintech startups should commit to in 2021. No matter how tech advanced the product is, human interaction is still crucial in customer service, especially for the industry dealing with a sensitive matter of money.